Generali to acquire Liberty Seguros for €2.3bn to broaden European footprint

Generali Group is set to acquire Liberty Seguros, a Spanish insurance company with operations in Spain, Portugal, Ireland, and Northern Ireland, from Liberty Mutual Insurance in a deal worth €2.3 billion.

This transaction enhances Generali’s presence in Europe, aligning with their growth strategy “Lifetime Partner 24: Driving Growth”. It bolsters Generali’s Property and Casualty (P&C) business and brings them to the fourth position in Spain’s P&C market while affirming their #2 position in Portugal.

Importantly, the deal enables Generali to penetrate the Irish market with a top 10 market share.

In line with the Group’s strategic goals, the acquisition of Liberty Seguros will facilitate economies of scale within the Generali Group, stemming from cost reductions, IT optimization, cross-selling of Generali products, and their track record in integrating businesses.

Liberty Seguros, a primarily P&C-focused company, registered over €1.2 billion in premiums in 2022 and will add its digital distribution capabilities to the Group’s strategic initiative.

Tim Sweeney — Liberty Mutual President and CEO said: “Our dedicated Liberty Seguros employees have done a tremendous job serving our customers, brokers, agents, partners and communities — building a highly respected and profitable business. They will be a strong addition to Generali, a leading global insurer with a strategic and adept business model.

“This decision further helps Liberty Mutual sharpen our operational focus to deliver exceptional value across our channels, products and markets.”

With Liberty Seguros’ solid direct business and customized product capabilities, the acquisition supports Generali’s digital multi-channel platform for direct sales initiative under its “Lifetime Partner 24: Driving Growth” plan. The plan intends to leverage Genertel’s capabilities to present a fully digital retail P&C offering, majorly in the Motor sector.

Following this transaction, Generali solidifies its position as a key player in Spain’s insurance market, particularly in motor and home insurance sectors. The deal also provides access to additional customer segments for multi-product solutions, courtesy of Generali’s broader product range.

The extended network of agents and brokers is projected to exceed 7,000 intermediaries, making it one of the largest in Spain.

In Portugal, the transaction strengthens Generali’s motor, home, and workers’ compensation business lines, and boosts its distribution network. It is seen as a strategic complement to the acquisition of Seguradoras Unidas and AdvanceCare in 2020 and aligns with the long-term distribution relationship established with CTT Group (Portuguese postal services) in 2022.

Entering the Irish P&C retail market for the first time, Generali secures a top ten market share position through this acquisition. This presence in a stable, profitable, and growing market is enabled by brokers and direct channels.

Philippe Donnet — Generali Group CEO said: “Thanks to the acquisition of Liberty Seguros we are accelerating the implementation of our “Lifetime Partner 24: Driving Growth” strategy, taking advantage of a unique opportunity that will deliver sustainable growth, strengthen our leadership position in Europe, and boost P&C growth.

“Generali is acquiring a profitable insurance business in three growing European markets with very attractive characteristics, that will create significant long-term value for all stakeholders. Thanks to this transaction, Generali is better placed than ever to be the Lifetime Partner of customers throughout Europe.”

The deal is awaiting customary regulatory approvals. Financial advisors for the transaction included Citigroup and Credit Suisse, while Clifford Chance, Morais Leitão, and Matheson served as legal advisors.